What's up everyone? Welcome to day 26 of my
small account challenge of growing a $2,000
account using Charles Schwab as my broker. Today
is a recordbreaking green day, the biggest green
day so far during the challenge. And there was a
question that a chat room member asked while I was
taking this trade. He said, "Ross, it looks like
you're risking $30,000 on this trade." And yeah,
I made money, but the amount you risk was far in
excess of the amount that you gained. And this is
a common question that a lot of people ask. And
so, I want to help you understand the way I think
about risk when it comes to trading. Yes, I did
put about $30,000 into this trade. That's a lot
of money. But if I was risking $30,000, then
it would mean that I was going to hold until
this went to zero or there was a high likelihood
that the position would become worthless. Now, if
you buy a lottery ticket and you spend $30,000 on
lottery tickets, there's a very high probability
that they will be worthless. You can't resell
them for any value. If you buy uh I don't know,
if you buy a used car and you're planning on
fixing it up and reselling it, then you spend
$30,000 on it, most likely, as long as you've
done at least a little bit of due diligence,
you're not going to be a max loss reselling it
for zero, right? I mean, it would have to have
something crazy crazy wrong with it for that flip
to go badly. And with trading, if I buy something
for $30,000, I know that it has value. And we're
in a liquid market where I can turn around and
sell it right away. So really then the question is
the difference between the price that I get in and
the price where I'm going to sell and bail out.
And so on this trade today, I was taking probably
more like 40 cents of risk per share. So then risk
based on the number of shares and cents per share,
that's the actual amount that was at risk. And so
in this trade, my profit was about two times the
amount that I was risking. Okay, so let's go
ahead and jump on the screen share and we'll
break it down in more detail. As a reminder, all
the profits from these small account challenges
gets donated to charity. And every time you guys
hit the thumbs up on the episodes in this series,
I add an extra dollar to how much I'm donating. We
have now raised over $390,000. And today I donated
$5,000 to the Children's Hospital in Wisconsin
and $5,000 to Stan Stan uh Sanford Health,
not Stanford, Stanford Health in South Dakota. So
we've now donated $390,000. So thank you guys for
hitting the thumbs up and helping me uh with
this challenge of making a donation to every
Children's Hospital or one children's hospital
in each state here in the United States. So 50
children's hospitals. That's the goal by the end
of this year. and we're right now at I think 33 or
32. Okay, so today's day 26. It's a Monday morning
and the market was warm. We had a couple of stocks
that were up quite a bit. We had DFNS, which
actually began its move in after hours trading
on Friday. I was looking at that one um as I put
together my watch list uh for Monday morning here.
Uh I was looking at it last night and it had this
nice rally as you could see here. um you know and
so I expected it would probably be good for a
trade right at uh the open of pre-market and it
was but then it kind of pulled back curled pulled
back then it popped back up to seven um kind of
pushed a little higher but wasn't able to get back
to those pre-market highs and so this one didn't
end up giving me any good trade uh opportunities.
Then we had um let's see what was the other one on
the scan? It was um LGHL. Now LGHL is a stock
that I've definitely traded before. Yikes.
Look at this drop at the open. So, you know, love
to see that. Um, I was actually wondering if this
would break through the volume weight average
price and squeeze back up towards those highs,
but as I looked at it, it was very thickly traded.
In any case, there was no opportunity pre-market
and then the bell ringing resulted in uh the
price actually selling off. But then we had EDBL.
EDBL came out with news earlier this morning about
um the uh the relationship they have with Walmart
and getting their products on the shelves at
Walmart and the stock ends up going from 350
up to 450 up to 550 650 750 850 all the way up
to $9.50 50 cents pulls back goes back up to
just under 10 and then now it's kind of started
to unwind a little bit but a really impressive
move. So I felt like it was safe to say that the
market was warm. Uh hindsight could have would
have should have traded EDBL in the small account.
Uh I did trade in my main account but not in the
small account. I sort of felt like I missed the
beginning of the move. The trades I just wasn't
as confident they would work. Um so anyways
no trades on that in the small account. LGHL,
no trades. DFNS, no trades. Uh, NBI YA, no trades
on this one either. It's a little bit um a little
bit cheaper and um has popped up a number of times
in the last few days and not worked out. Uh so
then all of a sudden we got this scanner alert at
about 9:15 9:17 and it was VTIX. Hits the scanner,
ding ding ding ding ding, and it goes from 292 292
to 349. So I was like, "Wow, this thing's moving."
light volume 18 million share float. And I pull
up the stock and I look at the news headline and
it says sells first enterprise system to Tesla
keyword for Optimus humanoid robot division. And
I thought that's very interesting. A small
cap company having any relationship with a
big company like Tesla or SpaceX. That's a
big deal. And so I pulled up a chart and I
saw that it had squeezed up right here, popped
up, squeezed up right here, pulled back, and I
jumped in on this pullback right here. And I was
looking for that break through 370. I took 4,000
shares at an average of about 350. My max loss on
this was well, you know, if it broke down to 320,
that wasn't going to look so good. Uh 315 and
certainly $3 hard stop. So 4,000 shares risking
at most 50 cents a share is $2,000. It ended
up squeezing up here. And as it squeezed up,
I doubled my position to 8,000 shares. But
as I doubled my position to 8,000 shares,
I adjusted my stop from down, you know, up to 50
cents a share to break even, which was now around
375. It ends up going to 425, up to 450, up to
460. I take profit off the table. It dips down. I
sell the rest as it starts to come back down. And
then I was looking potentially for another trade,
but it broke volume weight average price. And then
it came down and it actually ended up going red on
the day which is shocking. I am shocked that it
went red on the day in spite of this headline.
But it speaks to the market that we're in right
now where there's a lot of excitement especially
around Chinese foreign listed securities. In
fact with no news whatsoever. Yes, the floated
18 million shares is a little high. I thought
you know with this Tesla catalyst that would
be okay but evidently I was wrong. So, the move
was shortlived, but I jumped in, jumped out, and
I'm glad that I did. And I locked up just under
$4,000 of profit. So, about 2 to1 risk-to-reward,
which is great. And now the account's at a little
over $38,000. Now, all of this profit is getting
donated to charity. Uh, right now the account
is up just just shy at this point of 2,000%.
Averaging about 78% accuracy. So, I'm making good
progress. Next goal, $50,000, keeping the account
growing. And so we'll see how I do uh back at it
tomorrow morning for day 27. Now, if you guys have
not already checked out a two-eek trial, you can
watch as I continue growing this account. Granted,
it may not be uh what you would consider to be
a small account right now with $38,000. Uh but
I am still taking the approach generally of
uh just taking one or maybe two trades a day,
focusing on quality over quantity. I'm not super
active in this account. I'm just looking for the
best setups because I the stakes are a little
bit higher. I don't want to lose money that I'm,
you know, have already donated charity. So, I'm
donating basically as I go and putting it on my
American Express. So, if I lose, then, you know,
then I'm sort of losing money I already gave away,
which doesn't feel really great. So, I'm being a
bit more selective here. Uh, which I think many
of you guys appreciate. Uh, so anyways, check out
the twoe trial. Link is pinned at the top of the
comments. And I'll remind you guys as always that
trading is risky. My results aren't typical. And
there's no guarantee you'll find success whether
you trade with me or you learn on your own. So,
please manage your risk, take it slow,
and always practice in a simulator before
putting real money on the line. With that,
I'll see you guys back at it tomorrow at 7